The foundation for a global company law for multinational corporations

Amao, Femi
(2010)
The foundation for a global company law for multinational corporations.
International Company and Commercial Law Review, 21 (8).
pp. 275-288.
ISSN 0958-5214

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Abstract

The modern world has been transformed by globalisation and national boundaries are increasingly disappearing. There are institutional elements resembling a world government: the United Nations; World Banking Institutions: the World Bank and the International Monetary Fund; and internationalcourts: the International Court of Justice and the International Criminal Court. Also, interestingly, international legal personality is expanding. Over the years, it has expanded to include non-state actors such as intergovernmental organisations and individuals. Multinational corporations (MNCs)are recognised as major actors in the globalisation process. However, the international regulatory agenda has not paid sufficient attention to MNCs. Their regulation has remained largely confined to the domestic forums. The inability of domestic law to grapple with the concept of MNCs and the failure at international law to deal effectively with it have led to regulatory gaps. Three major areas of impact of MNCs' activities have attracted attention in recent times, albeit from different perspectives. The first is in respect of issues relating to the human rights accountability of MNCs, the second is in relation to the concept of corporate social responsibility and the third is in respect of systemic risks in international financial transactions posed by the operations of MNCs. This article posits that these issues are a product of the same development: the globalisation of domestic corporations and the absence of an appropriate regulatory framework to deal with MNCs international operations. This article argues that the solution lies in establishing the locus for the international regulation of the company as a method of doing business. This will involve developing the concept of the international company (IC) with an international corporate personality (analogous to corporate personality under domestic law) under an international company law framework to fill the regulatory gaps. This approach will facilitate the effective regulation of MNCs.